Devisfruto v. Greenfell
REITERATIONFacts
The Antecedents: Respondent Maxima Greenfell, a natural-born Filipino who later became an Australian citizen, financed the purchase of a house and two lots in Botolan, Zambales. These properties were registered in the name of her niece, petitioner Ruth Dizon Devisfruto, as the nominal buyer. The Devisfruto Spouses subsequently took possession of the properties and declared themselves owners for tax purposes. Upon reacquiring her Philippine citizenship, Greenfell demanded the transfer of the properties to her name, but the Devisfruto Spouses refused, leading to the filing of a complaint for reconveyance and damages. Procedural History: The Municipal Circuit Trial Court ruled in favor of Greenfell, finding that a purchase money resulting trust existed, as the Devisfruto Spouses admitted Greenfell provided the purchase money. The Regional Trial Court affirmed this decision. The Devisfruto Spouses then appealed to the Court of Appeals via a Petition for Review under Rule 42. The Court of Appeals dismissed their petition, agreeing that a trust was created and that the intention to create an implied trust was supported by evidence, including the testimony of the properties' former owner. A motion for reconsideration was subsequently denied. The Petition: The Devisfruto Spouses filed a Petition for Review on Certiorari with the Supreme Court, arguing that no trust was created, or if one was, it was an express trust not provable by parole evidence. They also contended that the properties were gratuitously given to them by Greenfell. The Supreme Court denied the petition, holding that the issue of express versus implied trust was not raised before the Court of Appeals and thus could not be considered for the first time on appeal. Furthermore, the Court found that even if the properties were considered a donation, the petitioners failed to present evidence of compliance with the formal requirements for donations under Article 748 of the Civil Code.
Issue(s)
Whether or not the Court of Appeals erred in finding that an implied trust had been created by the parties. Whether or not the Court of Appeals erred in not finding that the properties were given gratuitously to petitioners.
Ruling
The Petition is denied. The Court of Appeals Decision and Resolution in CA-G.R. SP No. 136663 are affirmed.
Ratio Decidendi
On the first issue of whether an implied trust was created: The Court affirmed the findings of the lower courts that a purchase money resulting trust under Article 1448 of the Civil Code was established. Both the Court of Appeals and the Regional Trial Court determined that the legal estate over the properties was granted to petitioner Ruth, while the price was paid by respondent Greenfell. Crucially, they found that the purpose of this arrangement was for Greenfell to have beneficial interest over the property, consistent with the definition of an implied trust under Article 1448. The Court found no cogent reason to revisit these conclusions, as they were supported by the evidence presented. The petitioners' argument that the trust was express and thus required written proof was rejected because this distinction was not raised before the Court of Appeals, violating the rule against raising new issues on appeal. The Court reiterated that issues not adequately brought to the attention of the lower court need not be considered by the reviewing court, as this is a basic consideration of due process. An exception exists only when the consideration of the issue is essential for a just decision, which was not sufficiently demonstrated by the petitioners in this case. The Court also noted that the petitioners failed to sufficiently explain why an exception should be made to consider the express versus implied trust distinction for the first time on appeal. On the second issue of whether the properties were given gratuitously: The Court found no reason to consider the petitioners' argument that the properties were given gratuitously. The parties admitted that Greenfell supplied the purchase money. If the transaction were a donation, it would be governed by Article 748 of the Civil Code, which requires donations of money exceeding P5,000.00 to be in writing. The petitioners, despite insisting on a gratuitous transfer, failed to present any evidence that this alleged donation complied with the formal requirements mandated by law. The Court cited Carinan v. Spouses Cueto and Moreño-Lentfer v. Wolff to emphasize that donations of money must comply with the mandatory formal requirements for their validity, including being in writing when the value exceeds P5,000.00. Since the petitioners did not present such written proof, their claim of a gratuitous donation could not be sustained. Therefore, the Court saw no reason to further consider this argument.
Main Doctrine
A purchase money resulting trust under Article 1448 of the Civil Code is established when property is sold and the legal title is granted to one party, but the price is paid by another for the purpose of having the beneficial interest in the property. The assertion of an express trust, which requires written proof for real property, cannot be raised for the first time on appeal if not adequately presented before the lower courts. Furthermore, a claim of gratuitous donation of purchase money must comply with the formal requirements of Article 748 of the Civil Code.